Shore Bancshares, Inc. · NASDAQ:SHBI
Shore Bancshares — Investor Presentation (November 2021)
23 slides from Shore Bancshares's investor presentation, Nov 10, 2021
Slide 1: Investor Presentation November 2021
1 Investor Presentation November 2021
Slide 2: Forward-looking statements
2 This investor presentation contains future oral and written statements of Shore Bancshares, Inc. (the “Company” or “SHBI”) an d i ts wholly - owned banking subsidiary, Shore United Bank, N.A. (the “Bank”), and its management, which may contain statements about future events that constitute forward
Slide 3: Management Team
3 Management Team * Reference Appendix section for biographies Name Title/Function Entity Years in Banking Years with Company Lloyd L. “Scott” Beatty, Jr. President and Chief Executive Officer SHBI, Bank 30 17 Edward C. Allen EVP and Chief Financial Officer SHBI, Bank 44 10 Donna J. Stevens EVP and
Slide 4: Financial Summary and Key Ratios
4 Financial Summary and Key Ratios Financial Ratio 12/31/20 YTD Ann. 9/30/21 Return on Average Assets (1) 0.92% 0.87% Return on Average Equity (1) 7.95% 9.14% Net Interest Margin 3.27% 2.97% Non - interest Income/Average Assets (2) 0.63% 0.54% Non - interest Expense/Average Assets (1),(2) 2.25% 2.09
Slide 5: Locations
5 Locations SHORE BANCSHARES Headquarters 18 E. Dover St. Easton, MD 21601 BANKING Shore United Bank 18 E. Dover St. Easton, MD 21601 877.758.1600 ShoreUnitedBank.com LOAN PRODUCTION OFFICES Shore United Bank 102 Sleepy Hollow Drive, Suite 204 Middletown, DE 19709 9748 Stephen Decatur Highway, Unit
Slide 6: Strategic Direction
6 Strategic Direction Market Expansion LPO’s and Strategic Branching – New Ocean City branch announced Acquire Banks Contiguous to our Existing Markets – Severn Bancorp merger (Closed 10/31/21) Leverage Back Office Capability Additions to Staff Have Been Primarily Production Operating Strategy Drive
Slide 7: Deposit market rank and share by county
7 Maryland Rank Share Branches Talbot 1 46.25% 4 Queen Anne’s 2 27.23% 5 Caroline 3 19.39% 2 Kent 4 10.02% 1 Dorchester 7 5.60% 1 Worcester 11 1.25% 1 Howard 14 0.45% 1 Baltimore 17 0.82% 2 Delaware Rank Share Branches Kent 6 4.74% 4 Virginia Accomack 6 1.76% 1 Selected SHBI Market Highlights 2021 M
Slide 8: Market Rank and Deposit Market Share
8 Market Rank Local Rank Ticker Company Name City (HQ) HQ State Branches 2021 Total Deposits 2021 ($000) ’21 Market Share (%) 1 – BAC Bank of America Corp. Charlotte NC 53 11,989,494 18.3% 2 – MTB M&T Bank Corp. Buffalo NY 71 11,273,996 17.2% 3 – TFC Truist Financial Corp. Charlotte NC 62 8,086,925
Slide 9: Recent Developments: Paycheck Protection Program
9 Recent Developments PAYCHECK PROTECTION PROGRAM (PPP) Shore United Bank team responded quickly to identify impacted customers As of September 30, 2021, 2,454 loans were processed and funded for $196.3 million 27% of loans to new customers; $49.0 million funded. As of September 30, 2021, 2,044 loan
Slide 10: Targeted, Organic Balance Sheet Growth
10 Total Deposits ($M) Total Assets ($M) Total Gross Loans Held for Investment ($M) NCOs / Avg. Loans Targeted, Organic Balance Sheet Growth 1) Core deposits defined as total deposits less total CDs >$250,000 and brokered deposits (as of September 30, 2021) Source: S&P Global Market Intelligence; Co
Slide 11: Strong, Consistent Historical Profitability
11 Net Income from Continuing Operations ($M) ROAE from Continuing Operations ROAA from Continuing Operations NIM (FTE) Strong, Consistent Historical Profitability Note: 2021Q3 metrics are YTD; Yellow dotted lines in 2018 denote results including proceeds received from sale on insurance s ubs idiary
Slide 12: Income Statement (Quarterly)
12 Income Statement (Quarterly) Dollar Value in Thousands 12/31/2019 12/31/2020 3/31/2021 6/30/2021 9/30/2021 Interest and Fees on Loans $14,043 $14,541 $14,366 $14,381 $15,484 Other Interest Income 1,122 954 978 1,150 1,415 Interest Income 15,165 15,495 15,344 15,531 16,899 Interest on Deposits 2,2
Slide 13: Loan Portfolio Composition
13 (Dollar Value in Thousands) As of September 30, 2021 Loan Type Balance % of Total Construction $130,590 8.7% 1 - 4 family residential 12,858 CRE Lot Loans 22,719 Land Development 14,860 Commercial Const Non 1 - 4 Family 72,637 Consumer RE Lot Loans 7,516 Residential Real Estate 460,890 30.8% Secu
Slide 14: Credit Quality Statistics
14 Dollar Values in Thousands 12/31/2019 12/31/2020 9/30/2021 Non - performing Assets Nonaccrual Loans $10,590 $5,455 $3,457 90+ or More Days Past Due 1,326 804 748 Other Real Estate Owned 74 -- 203 Total Non - Performing Assets $11,990 $6,259 $4,408 Performing TDRs $7,501 $6,997 $5,750 Total NPAs +
Slide 15: Securities Portfolio
15 (Dollars in thousands) Amortized Cost Gross Unrealized Gains/(Losses) Estimated Fair Value Available - for - sale securities: September 30, 2021 U.S. Government Agencies $18,557 $(574) $17,983 Mortgage - backed 86,254 888 87,142 Total $104,811 $314 $105,125 Held - to - maturity securities: U.S Go
Slide 16: Attractive Deposit Base
16 (Dollar Value in Thousands) September 30, 2021 Deposit Type Balance % of Total Average Rate (%) Noninterest Bearing Demand 554,902 27.5 0.00 Interest Bearing Demand 515,796 25.5 0.14 Money Market & Savings 663,617 32.9 0.18 CDs $100,000 or more 140,390 7.0 1.00 Other Time 143,361 7.1 0.90 Total D
Slide 17: Yield Table with and without excess liquidity
17 Yield Table – 9/30/21 YTD with and without excess liquidity As reported YTD 9/30/2021 Without $200 million in excess liquidity YTD 9/30/2021 (Dollars in thousands) Average Balance Interest Yield/rate Average Balance Interest Yield/rate Earnings assets Loans $1,461,083 $44,340 4.06% $1,461,083 $44
Slide 18: Capital Ratios (Bank Only)
18 Capital Ratios (Bank Only) 10.64% 9.73% 9.04% 13.00% 13.21% 12.90% 13.00% 13.21% 12.90% 13.87% 14.25% 13.94% 0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12.00% 14.00% 16.00% YE 2019 YE 2020 9/30/2021 Tier 1 Leverage Ratio Common Equity Tier 1 Tier 1 Risk-Based Capital Ratio2 Total Risk-Based Capital Rat
Slide 19: Compelling Investment Considerations
19 Compelling Investment Considerations Excellent Cost of Funds Strategic plan positioned for organic growth and acquisitions Focused on creating sustainable competitive advantages Strengthened noninterest revenue sources Driving a sales culture with both a commercial and retail focus while maintain
Slide 20: Appendix
Shore Bancshares} Appendix 20
Slide 21: SHBI Management Team
21 SHBI Management Team Talent, depth, unique skills Lloyd L. “Scott” Beatty, Jr ., 69, CPA, President & CEO of Shore Bancshares, Inc. since June 2013, Director of SHBI since December 2000, Director of Shore United Bank (formerly the Talbot Bank and CNB) since 1992. COO from 2006 until 2012 and name
Slide 22: Historical Balance Sheet
22 Dollar Values in Thousands 2017 2018 2019 2020 9/30/2021 Assets Cash and Cash Equivalents $31,820 $67,225 $94,971 $186,917 $310,852 Available for Sale Securities 196,955 154,432 122,791 139,568 105,125 Other Securities 3,735 7,745 5,532 70,727 255,074 Total Cash & Securities 238,757 235,445 232,0
Slide 23: Consolidated Historical Income Statement
23 Consolidated Historical Income Statement (1) Includes merger related expenses of $377 thousand. Net income excluding these expenses would’ve been $8,309 for the second qu art er of 2021. (2) Includes merger related expenses of $538 thousand. Net income excluding these expenses would’ve been $5,15
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